Temporary power supply group Aggreko has blown a fuse after warning that increased bad debt provisions and adverse exchange rates would hit its full year profits.

In a trading update which initially seemed relentlessly positive - including a £59m benefit from contracts for the London 2012 Olympics - the sting was in the tail.

The company said its anticipated profits for the year would be hit to the tune of 2.5% - although they are still expected to be up on the year - because of bad debts and exchange rates, and said it was also mindful of "a weakening macro-economic outlook in many developing economies." It reckons second half revenues in its international business will grow more slowly than it expected at the time of the half year results.

On the plus side, third quarter revenues grew by 22%, in line with expectations.

But the downbeat outlook has left its shares 7% lower, down 162p at £21.40, making it the biggest faller in a FTSE 100 which has edged slightly lower.

Many analysts kept their buy recommendations, however, saying the problems were only...temporary. But Panmure Gordon has a hold rating at cut its profit forecasts. Analyst Paul Jones said:

Third quarter order intake for its international power projects' business was below last year, though as the fourth quarter started two further wins were made. Of more concern is the increase in bad debts and the on-going macro pressure which leads the company to be more cautious on 2013 than before. We downgrade both 2012 and 2013 [earnings per share] forecasts accordingly [by 2.7% and 3.1%], though we remain holders. Our target price drops from 2228p to 2159p based on the lower earnings.

And BarCap (as was) pointed out another possible concern:

For this year consensus is likely to come down to around £365m of pretax profit from £377m due to foreign exchange and some extra bad debt but what might perturb the market a little more is the reduction in capital expenditure. Guidance is for the first half next year to be around £150m versus the underlying £190m of 2012.

Overall the FTSE 100 is down 6.33 points at 5910.72 as the EU summit continues, with minor progress being made in the continuing eurozone crisis.

Elsewhere Burberry is 12p better at £11.92 after Investec lifted its recommendation from hold to buy. Analyst Bethany Hocking said:

We return to our bullish stance, after a brief period at hold post the profit warning. The first half pre-close reported two key pieces of news in our view -"a modest improvement" at the period end and a continued elevation in the 'luxury' nature of product sales. We have tweaked some assumptions, with the net effect of marginal increases in 2013 to 2015 pretax profit estimates. The Burberry brand is far from broken, operational leverage should come through, and, whilst volatility will remain, we see long-term value here.

Banks moved lower, with Barclays down 5.25p to 235.45p following news it had set aside another £700m to compensate customers who were wrongly sold payment protection policies.